Despite an extremely difficult trading environment, the
Sumitomo (SHI) Demag group generated a sales turnover of 762 million euros last year. This was only 6% lower than the historic figure reported in 2021, when the
group achieved its highest turnover to-date. CEO Gerd Liebig (pictured right) said the dramatic rise of material availability and costs inevitably impacted the company’s overall sales and profitability in 2022.
Mr Liebig added: “Passing on these monthly cost increases to customers would hardly have been considered reasonable. We very much hope for more stable supply chains in 2023, as this will enable us to offset any cost increases with higher production efficiency.” Referencing the company’s Wiehe production site, he cited the company’s six-year production model which is geared totally towards all-electric machines as the epitome of successful cost reduction and efficiency.
The CEO noted that globally, the key sector markets experienced a 30% slump in 2022. Although automotive and consumer performed below expectations overall — attributed mainly to the material, energy and raw materials cost burdens — Sumitomo (SHI) Germany’s market share in packaging, medical and the automotive sectors continued to increase. Specifically, all-electric machine production reached another high point, with Mr Liebig pleased to reveal that every fourth all-electric machine produced in Europe is now an IntElect.
Mr Liebig confirmed that with the launch of two high-performance machines in the company’s all-electric series — PAC-E and IntElect S — Sumitomo (SHI) Demag is on track to continue its success story. Both new machines cater specifically to the high-speed, high-precision injection moulding segments, ranging from caps to thin-walled products. He continued: “Our complete portfolio of all-electric machines now covers all market requirements — from the highest energy efficiency and precision to the fastest and most productive cycle times. Given the current developments in electricity costs, the future demands for all-electric systems in both the packaging industry and the consumer segment is anticipated to be very strong.”
The CEO anticipates that by 2024 at the latest, every second machine built in Europe will be fully electric. He explained: “In view of the rising energy prices, the ROI for almost all applications has fallen drastically. This makes the investment in all-electric machines not only affordable, but now absolutely future-proof.” Aligned to this is the growing demand for automation, pointing to another key company milestone. Following the market launch of the SAM-C robotics solution and the availability of the SAM-S in 2023, Sumitomo (SHI) Demag continues to add to its total integration and automation competence.
Southern Europe market escalates Reflective of the evolving manufacturing landscape in Europe, the group observed significant activity in Southern and Southeastern countries, notably substantial growth in the Czech Republic, Hungary and Italy. All locations where Sumitomo (SHI) Demag has invested extensively in new subsidiaries in recent years.
Mr Liebig attributes this significant increase in market share to the company’s enhanced presence and local service and technology application expertise, as well as widespread adoption of all-electric machines. Additionally, the CEO is thrilled to announce the completion of its service digitalisation concept. “This digitalisation roadmap is also now largely implemented in our products and production.”
Looking ahead to this financial year, Mr Liebig expects material availability to relax significantly in 2023 and a slight easing on the massive cost pressures. However, the challenges driven by higher wages, electricity prices, high inflation costs, rising microchip costs, along with other cost considerations — including transportation, container shipments and sheet metal and steel costs — all remain prevalent.
Mr Liebig said: “Currently, the international markets remain very weak as a result of the continuing uncertainties, high inflation and energy prices, as well as the ongoing cost increases in raw materials. In America and Europe, we expect market demand to increase from May. Likewise in China, although amendments to their domestic corona policies will likely impact medical and packaging. Pressures in the automotive industry are likely to carry into this business year too.”
Now entering its fifth consecutive year of challenges and market crisis, the CEO is resolute that the company’s values continue to endure: “To get through this crisis in solidarity. With this unified outlook I am optimistic given the intense popularity of our machines, that market interest, market share and movement towards sustainability and digitalisation will continue in an upward direction.”